The US Energy Information Administration (EIA) believes domestic oil production will grow by around 160,000 B/D this year but remain flat in 2026 as producers slow drilling activity. The forecast for 2025 is roughly 50,000 B/D less than the agency’s projections from this past June.
“Declining oil prices have contributed to US producers slowing their drilling and completion activity this year,” the report read. “As a result, we forecast US crude oil production will decline from an all-time high of just over 13.4 million B/D in the second quarter of 2025 to less than 13.3 million B/D by the fourth quarter of 2026. On an annual basis, we now forecast crude oil production will average 13.4 million B/D in both 2025 and 2026.”
The latest US rig count from Enverus shows about 142 rigs drilling for oil, down 57% year-over-year. The same count showed gas rigs at 108 units, down 23% from last year’s numbers. Of the top 10 operators by active rig count, only BP is working more rigs now on a weekly average than at this time in 2024.
The EIA report sees West Texas Intermediate (WTI) pricing continuing to soften into 2026 despite the recent spike due to the geopolitical climate. Increased production from OPEC+ countries is also expected to put downward pressure on crude prices this year.
Earlier this month, the group said to would turn the taps and add almost 550,000 B/D of crude oil output in August.
According to the EIA forecast, a barrel of WTI will spend most of next year below $60 and could brush $50 by the end of 2026.
Compared with its June forecast, the agency expects more natural gas in storage in the coming months. As a result, it reduced its forecast for natural gas prices. The EIA expects Henry Hub gas to run about $3.40/MMBtu in the upcoming quarter—that’s a 16% dip from last month’s prediction.
Overall, the agency sees gas price rebounding for 2026, with Henry Hub averaging $4.40/MMBtu for the year. It said the forecast increase reflects the expectation that production will fall slightly in 2026, while LNG exports continue to increase.
